Senior London bankers are being banned by bullying accusations
It used to be that senior people in investment banking could bully juniors with impunity. When ex-Morgan Stanley analyst Florian Koelliker asked millennial and Gen Z bankers what their issues with the industry were a few years ago, he was told that shouty senior bankers were one of them. - A senior US banker in particular was called out for 'cursing and freaking out.'
That sort of stuff may still be permissible in some locations, but if you're a managing director who's shouting at colleagues in London, beware. Lawyers say increasing numbers of senior people are being locked out of the market following accusations of bullying.
"The legal test for harassment and bullying is not a high bar," say Joanna Chatterton, partner and head of the employment team and Chris Finney, partner and non-contentious financial services lead at law firm Fox Williams. "We are seeing an increased confidence, particularly by younger employees, to speak out about such behaviour leading to more disciplinaries."
If you're senior in the UK, this matters. Under the UK's senior & managers certification regime (SMCR), senior British bankers must provide regulatory references going back six years which testify whether they are "fit and proper" before they can move to new jobs.
Chatterton and Finney say these references, or the lack of them, are excluding an increasingly large pool of people from getting new jobs. "There is a body of often experienced professionals driven out of the market, possibly without good cause, under a regime which can operates very harshly and inconsistently because there is insufficient and not very clear guidance to firms about how to apply the rules."
Similar rules don't exist in the US, where Lazard MD Reid Snellenbarger was recently fired for alleged 'inappropriate touching' at a work party. In London, Chatterton and Finney say sexual harassment is seen as having implications for integrity. This can apply equally to harassment outside of work.
Some of those impacted are challenging their exclusion. Chatterton and Finney say cases are progressing through the courts involving senior bankers who've either claimed unfair dismissal or who are bringing civil cases for 'negligent misstatement' against former employers whose references aren't sufficient for them to get new jobs.
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